THE IMPACT OF SERVICE QUALITY AND BRAND AWARENESS ON BRAND LOYALTY: (A STUDY OF TELECOMMUNICATION COMPANIES IN NIGERIA)

ISSN 2349-7807
International Journal of Recent Research in Commerce Economics and Management (IJRRCEM)
Vol. 3, Issue 3, pp: (18-25), Month: July - September 2016, Available at: www.paperpublications.org
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Paper Publications
THE IMPACT OF SERVICE QUALITY AND
BRAND AWARENESS ON BRAND
LOYALTY: (A STUDY OF
TELECOMMUNICATION COMPANIES IN
NIGERIA)
OJELEYE, YINKA CALVIN
Department Of Business Adminstration, National Open University of Nigeria
Abstract: The study investigate the impact of service quality and brand awareness on brand loyalty. The
participants of the survey were 400 mobile telecommunication subscribers from the fourteen local government
areas of Zamfara state derived using Taro Yamane sample size formula. Regression analysis was the statistical
tools used to test for the two hypotheses using version 22 SPSS. The findings suggested that that there exist
significant positive influence between brand awareness and brand loyalty, service quality and brand loyalty. The
present research provides resourceful and clear findings for telecommunication companies which can be harnessed
in their effort to create and implement successful customer loyalty strategies. Future research can also look into
other sub-variables under brand awareness like traditional advertisement, non-traditional advertising, sales
promotion, leveraging on the web, sponsoring local and social events and their ratio of relative significance on
brand loyalty.
Keywords: Brand Awareness, Brand Loyalty, Service Quality.
1. INTRODUCTION
Brand awareness means the ability of a consumer to recognize and recall a brand in different situations (Aaker,1996).
Brand awareness is an important indicator of consumers’ knowledge about a brand, the strength of a brand’s presence in
the consumers’ minds and how easily that knowledge can be retrieved from memory (O’Guinn, Allen and Semenik 2009).
Brand loyalty can be conceptualized as the final dimension of consumer brand resonance symbolizing the consumer's
ultimate relationship and level of identification with a brand (Keller, 2008).
According to Jacoby and Kyner (1971) brand loyalty is the biased ( nonrandom) behavioural response (purchase)
expressed over time by some decision-making unit with respect to one or more alternative brands out of a set of such
brands and is a function of psychological(decision-making, evaluative) process. The definition is expressed by a set of six
necessary and collectively sufficient conditions.
Over the past four decades brand loyalty has been recognized as a focal point of marketing literatures and for
practitioners. It is considered as a contributor to build and maintain brand equity (Aaker, 1991). As brands gain exclusive,
positive, and prominent meaning in the minds of a large number of consumers, they become irresistible and irreplaceable,
and win the loyalty of the consumers (Erdogmus and Cicek, 2012) Brand loyalty, in return, brings sales revenues, market

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share, profitability to the firms, and help them grow or at least maintain themselves in the marketplace (Keller, 2008;
Aaker, 1991, Kapferer, 1997).
The present-day marketplace is flooded with a wide variety of product brands. Consequently, synchronizing with this
inundated of diverse brands in the market has become lurid for the simple consumer (Suresh, Monahan &Naresh 2012).
Today’s, organizations aim is not only sell their products or services, but also make relationship to customers that lead to
customer loyalty in happen during the process that consist introduce products to customer, knowing it, and then selecting
it. If there process was customers, knowing it, and then selecting it. If this process was passed successfully, customer will
be loyal to brands (Tajzade et al, 2009; Doostar et al, 2013). Tandoh (2015) mentioned that the increasing of consumer
awareness has made consumers choose to buy their acquainted and favorable brand. Therefore, if bus inesses want to
overcome their competitors, they have to make consumers adore to purchasing their products and brands.
Representing one of the most important factors believed to explain consumer brand choices, it is no surprise that the
concept of brand loyalty has aroused an enormous interest among academics as well as practitioners within the field of
marketing and consumer behaviour (Jensen and Hansen, 2006)
Zeithaml (1988) defined service quality as the judgment of customers about the overall superiority of a product or service.
Service quality is determined by consumers themselves, and occurs when an organization provides services that meet the
needs of consumers (Metters et al. 2004).
The telecommunication sector in Nigeria has become very competitive since the recent deregulation by the Obasanjo's
regime over twelve years ago. The sector attracts considerable foreign investment due to the influx of both local and
foreign investors into the market. Customers switch from one telecom service provider to another looking for service
brands that will meet their expectations. These problems are likely to render some telecom outfit non -competitive in the
short run and a possible liquidation in the long run. There is therefore, the need to consider brand awareness and quality
service as very important in planning a business strategy for creating customer loyalty. The research work will create the
awareness to the four major telecom service providers (MTN, Globacom, Airtel and Etisalat) in Nigeria to embark on
brand loyalty driven activities.
These hypothesis are formulated and tested:
H01 There is no significant relationship between brand awareness and brand loyalty
H02 There is no significant relationship between quality service and brand loyalty.
2. CONCEPT OF BRAND AWARENESS
Malik, Ghafoor, Iqbal and Shahbaz (2013) brand awareness is the probability that, consumers are familiar about the
availability and accessibility of a company’s product and service. It is consumers’ ability to identify the brand under
different conditions, as reflected by their brand recognition or recall performance (Kotler and Keller, 2012). Moisescu
(2000) describe that Brand awareness can be depicted into brand recognition (consumers’ ability to confirm prior
exposure to the brand when given the brand as cue) and brand recall (consumers’ ability to retrieve the brand when given
the product category, the needs fulfilled by the category, or some other cues). Brand awareness is very important because
if there will be no brand awareness no communication and no transaction will be occur (Percy, 1987). Some of the
consumers can make rule to purchase only those brand which are famous in the market (Keller, 1993).
There are two main types of brand awareness, namely ‘aided awareness’ and ‘top of the mind awareness’ (Farris et al.
2010). Aided awareness occurs when a consumer is provided with a list of brand names and they recognize the brand
from the given set whereas ‘top of the mind awareness’ occurs when the name of the brand is automatically recollected
because the consumer very promptly associates the brand with the product category (Keller 2008). Koniewski (2012)
asserted that Brand awareness is a measure of the effectiveness of a company’s marketing activity and, that the strength of
the consumer’s emotional link with the brand is better reflected by the brand named first, than by spontaneous recall. He
referred to spontaneous recall as the brands named by the consumer himself/herself. These are the ones from among
which the consumer chooses, when buying the product of a given category. Spontaneous brand recall thus defines the
consumer’s selection range. To Neumeier (2006) brand recall means, when consumers see a product category, they can
recall a brand name exactly and, brand recognition means consumers has ability to identify a brand when there is a brand

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cue. That is, consumers can tell a brand correctly if they ever saw or heard it. Tangible attributes of branding, such as a
brand name, logo, symbol, icon, and metaphor, facilitate consumers‘ awareness of a brand. Moreover, advertising and
positive word-of-mouth regarding a brand may enhance brand awareness, which plays an important role in consumer
decision-making (Aaker, 1996, 2007; Pitta & Katsanis, 1995; Tandoh, 2015)
3. THE CONCEPT OF SERVICE QUALITY
Service quality is not an easy task to quantify and being evaluated, because it is not a product to quantify but it is
customer’s evaluation and subjective perception about something (Sabir et al., 2013). Service quality is a unique feature
of a product and image, that it put the product at a better competitive advantage ahead of other close substitute and
competitors products. It encourages customers to good mouth the product to others which according to Gundersen (1996)
service quality leads to higher profitability. Ennew and Binks (1999) also argued that service quality can be used to
differentiate between two service provider's services and, to win strategic competitive advantage. The service quality
delivered is a key determinant of overall satisfaction, which in turn leads to customer retention and loyalty. Parasuraman
et al. (1991) believe that consumers’ perception of service quality has a positive influence on their willingness to
recommend the company to others, and that willingness to recommend is an important indicator of customer loyalty.
In 1990 Zeithamlet, al. presented the five dimensional SERVQUAL scale to measure the service quality. These
dimensions are: responsiveness, reliability, assurance, tangibility and empathy. These constructs have higher correlation
with each other (Saleem, 2014). According to Grönroos (1984) the quality experienced by a customer is based on two
dimensions (a technical and a functional dimension), moderated by the company image. The functional dimension takes
into account the way a service is provided (e.g., courtesy, attention, promptness, professionalism). The technical
dimension refers to the result of the service as such (e.g., a life insurance policy). Rust and Oliver (1994) add a third
dimension to Grönroos’ proposition, taking into account the environment where the service is provided
4. CONCEPT OF BRAND LOYALTY
Aaker (1991) defines brand loyalty as symbolizes a constructive mind set toward brand that leading to constant
purchasing of the brand over time. Brand loyalty is a measure of the extent to which consumers are loyal to a particular
brand over a period of time, which emphasizes a consistent repurchase of the same brand (Sheth & Mittal 2004). Simply
put, Brand loyalty result in a particular customer developing a psychological and emotional attachment, dependence,
passion and affinity to a particular product leading to frequent repurchase even when other competing products are not out
of sight. Loyal customers are repeat customers who choose a company’s brand without even considering other
alternatives. ( Latif et al, 2014) They buy more and regularly and also they frequently recommend as well as advice about
a brand to others (Manternach, 2010)
Oliver (1999) also describe loyalty as a deeply held commitment to re-buy or repatronize a preferred product or service
consistently in the future, causing repetitive same brand or same brand-set purchasing, despite situational influences or
marketing efforts. brand loyalty is constructed over time through a collection of positive experiences that requires
continuous effort and concentration to detail.
There are two types of loyal customers. The behavioral and the emotional, the behavioral customers will become loyal
with brand but not emotional however the emotional customers will also be emotional with the particular brand in which
they interested (Jones et al, 1995; Malik et al, 2013).
Empirical Studies
Agyei et al (2013) examined the relationship between service quality and customer loyalty in the Kenyan mobile
telecommunication service industry. The SERVQUAL model was adopted in the study. 320 Kenyatta University students
drawn from five of its campuses were selected for the population of the study using multi-stage stratified sampling
technique. Pearson product-moment correlation coefficient and regression analyses were the parametric statistical tools
used to test the association and effect in the study. A significant relationship was found between service quality and
customer loyalty.

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Recent study conducted by Waseem (2016) the study investigated the impact of service quality on brand loyalty of the
Smartphones users in District Vehari, Punjab, Pakistan. Participants of research study were the students of higher
education institutes in District Vehari, Punjab, Pakistan who were served questionnaire for data collection. For the
explanation of this research study, independent variable is the four dimensions of customer service quality such as Value-
added-services, Mobile devices, Price, Customer services and dependent variable brand loyalty. He used both explanatory
and descriptive approach on the study. Non-probability technique such as convenience sampling is used for sample A
series of statistical techniques i.e. frequency distribution, reliability, validity, regression and correlation are conducted to
test the hypotheses. The findings showed that service quality dimensions as a whole on brand loyalty are significant.
Tandoh (2015) investigated the impact of brand awareness on brand loyalty of Sinapi Aba Savings and Loans Ghana
Limited. Data was drawn from both primary and secondary sources and the main instrument for data collection was the
questionnaire and interview involving 301 respondents sampled from the customers of Sinapi Aba Savings and Loans
Ghana Limited across Ghana and a brand manager of Sinapi Aba Savings and loans Limited. The finding from the
research showed that, the brand awareness strategy that customers were mostly aware of was the traditional advertising.
The findings concluded that brand awareness has significant impact on brand loyalty.
5. RESEARCH METHODOLOGY
The research design used for this work was the survey research design. In this research work, primary method was used
for the collection of data. Also, the use of survey research design is due to the fact that the data are point in time. The
population of this study comprised of all the subscribers in the 36 states plus Abuja the nation's capital which, according
to the last population census of 2006 is 140,000,000 million people. And the sample size was reduced using the
computation below. The sample size of this study was derive using Taro Yamane formula to estimate it.
n= N/[1+N(e)2
n= Sample size
N=Population size
e= sample error (assuming 5%)
1= constant.
n=1400000000/1+140000000(0.05)2
= 140000000/1+140000000(0.0025)
=140,000,000/1+350,000
=140000000/350001
= 399.99 or 400
A questionnaire was designed to collect data from subscribers in Zamfara state in the Northwest Geopolitical Zone of
Nigeria. The qustionnaire was distributed among the 14 local government areas in the state, based on the telecoms service
coverage. A five point likert scale was also designed and 400 copies of questionnaire was distributed and, the researchers
added additional 50 copies of questionnaire to indicates a successful return of 400 copies of questionnaire that was used in
the analysis. Ordinary least-square regression model was adopted using SPSS Version 22. The simple linear regression
models are stated below:
BL= β0+ β1BA +µ…................................................................equ. (1)
Where BA= Brand Awareness, CL= Brand Loyalty, µ= Error term capturing, other explanatory variables not explicitly
included in the model. β0 = Constant Parameter
BL= β0+ β1SQ+ µ…................................................................equ. (2)
Where SQ= Service Quality, CL= Brand Loyalty, µ= Error term capturing, other explanatory variables not explicitly
included in the model. β0 = Constant Parameter

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6. DATA ANALYSES
SPSS RESULT FOR BL= β0+ β1BA +µ….................................equ. (1)
Model Summary
Model R R Square
Adjusted R
Square Std. Error of the Estimate
1 .590a
.348 .346 1.012
a. Predictors: (Constant), BRAND AWARENESS
ANOVAa
Model
Sum of
Squares Df Mean Square F Sig.
1 Regression 217.209 1 217.209 212.015 .000b
Residual 407.751 398 1.024
Total 624.960 399
a. Dependent Variable: Brand Loyalty
b. Predictors: (Constant), BRAND AWARENESS
Coefficientsa
Model
Unstandardized Coefficients
Standardized
Coefficients
t Sig.B Std. Error Beta
1 (Constant) 1.709 .118 14.496 .000
BRAND
AWARENESS
.553 .038 .590 14.561 .000
As shown above, the model fit the data, the coefficient of determination adjusted R², which measured the proportion of
changes in the dependent variable that is explained jointly by the independent variable, was 0.346 and the remaining
0.654 is explained by other factors outside the model. This implied that a unit change in the independent variable (Brand
Awareness) could bring about 34.6% changes in the dependent variable (Brand loyalty) or This suggests that brand
awareness can explain 34.6% of consumer loyalty variation. This therefore reinforces the fact that the model is of good
fit. The model is adequate since the F-statistics (212.015) is significant at 1%.This means that the coefficient of the
explanatory variable is statistically significant. The result of the regression model simply show brand awareness
encourages customer to patronize particular telecommunication product consequently brand awareness has significant
influence on brand loyalty.
SPSS RESULT FOR BL= β0+ β1SQ+ µ…................................equ. (3)
Model Summary
Model R R Square
Adjusted R
Square Std. Error of the Estimate
1 .794a
.631 .630 .761
a. Predictors: (Constant), SERVICE QUALITY
ANOVAa
Model Sum of Squares Df Mean Square F Sig.
1 Regression 394.439 1 394.439 681.009 .000b
Residual 230.521 398 .579
Total 624.960 399
b. Predictors: (Constant), SERVICE QUALITY

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Coefficientsa
Model
Unstandardized Coefficients
Standardized
Coefficients
T Sig.B Std. Error Beta
1 (Constant) .799 .102 7.851 .000
SERVICE QUALITY .813 .031 .794 26.096 .000
As shown above, the model fit the data well and the explanatory power was relatively high and significant. The
coefficient of determination adjusted R², which measured the proportion of changes in the dependent variable that is
explained jointly by the independent variable, was 0.63 and the remaining 0.37 is explained by other factors outside the
model. This implied that a unit change in the independent variable (Service Quality) could bring about 63% changes in the
dependent variable (Brand loyalty) or This suggests that service quality can explain 63% of the brand loyalty variation
This therefore reinforces the fact that the model is of good fit. The model is adequate since the F-statistics (681.009) is
also significant at 1%.This means that the coefficient of the explanatory variable is statistically significant. The result of
the regression model explains that Service Quality encourages customer to repurchase a particular product of a telecom
service provider frequently thus service quality has significant influence on brand loyalty.
7. DISCUSSION OF FINDINGS
The findings from the analyses above endorse the impact of brand awareness on brand loyalty among the subscribers of
mobile telecommunication service in Zamfara state. This is also in tandem with the findings of Dhurup et al (2014),
Tandon (2015), and Firnd et al. (2015) on the impact of brand awareness on customer loyalty. The finding also collaborate
with study of Sabir et al (2013), on the positive significant influence of service quality on brand loyalty but disagree with
the study of Chao et al (2015) which concluded that there is no significant positive relationship between service quality
and customer loyalty. Instead, this relationship is mediated by customer satisfaction. Similar view is partially supported
by Saleem et al. (2014).
8. CONCLUSION AND RECOMMENDATION
This study conclude that brand awareness and service quality have significant positive influence on brand loyalty among
mobile telecommunication subscribers in Zamfara state. The study therefore recommend that, mobile telecommunication
companies if loyalty must be ensured, fixing their nationwide epileptic service is not an option because high service
quality will boost customer satisfaction, eventually resulting in brand loyalty.
Likewise, the in the face of fierce competition, most customer prefer to purchase brands that they are familiar with.
Therefore, telecommunication companies but employ various awareness campaign to induce prospective customers to
attempt first trial and eventually loyalty.
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